Current Category: Products/Services

Thank you for your patience with the computer conversion that we are experiencing. While a conversion is always a headache to members and staff, the end result should be a more efficient and economical system. In addition, the new system will enhance our "green" business environment as fewer forms will need to be printed.

A few reminders - "Virtual Branch" is now "Home Branch." Bill Pay will be available on August 4 and the merchant information that you had entered will remain. The history of your automatic bill payments did not transfer to the new system. If you have misplaced the letter I sent announcing the changes and new password information, give us a call and dial "0" for the call center.

I sincerely hope that you will like the new system once you have used it a few times.

Members let me know how pleased they are with the mortgage loan options offered to them at Service One. We offer fixed-rate and variable-rate mortgage loans customized to ensure that our members are able to meet their homeownership goals. Ken Vogler and his mortgage department work individually with each member to develop the best mortgage for them. Sometimes this means saying "Not now, but this is what you need to do to qualify next year."

The following article describes credit union mortgage lending from the national perspective.

Big foreclosure increases unlikely to be so big at CUs

MADISON, Wis. (4/16/10)--The nation saw a 35% spike in home foreclosures in first quarter compared with first quarter 2009. While credit unions likely will see foreclosure increases, their general asset quality remains relatively high--which may be a good omen, said Credit Union National Association (CUNA) Senior Economist Mike Schenk.

Households facing foreclosures grew 16% for the quarter and 7% from the last three months of 2009. It's the biggest jump in foreclosures since January 2005, said Irvine, Calif.-based Realty Trac, which tracks notices of defaults, scheduled auctions and home repossessions (msnbc.com April 15). More than 900,000 households--one in every 138 homes--received a foreclosure notice during first quarter, said the firm.

How do the first quarter national numbers compare to credit union experience?

"We really don't know because we don't have any first-quarter credit union operating results yet, and even if we did, credit unions don't report foreclosures on their call reports," said Schenk, who is vice president of CUNA's economics and statistics department.

"Nevertheless, it would be difficult to argue that credit union trends won't mirror--to some extent--the trends of the broader market. Credit unions likely will see foreclosures increase. But asset quality at credit unions is generally much higher compared to what we see in the for-profit sector," Schenk told News Now.

For example, at the end of 2009, credit unions' delinquency rate for all mortgages was 1.97%. In contrast, the mortgage delinquency rate in the banking industry was three-and-a-half times higher at 7.1%. It's important to note that banks report delinquencies on a 90-plus day basis, while credit unions report on a 60-plus day basis. "The bank delinquencies are much higher in spite of their having one extra month to collect," Schenk said.

Schenk also noted that the delinquency rate on credit union mortgages has been declining over the past two quarters. "That's further evidence that the foreclosure trends will be more muted in the credit union sector."

Credit union mortgage loan net chargeoffs averaged 0.55% in 2009--about one-quarter the banks' 2.20% net chargeoff rate in the year. Moreover, credit unions' mortgage chargeoff rate is the lowest of all the major loan categories--including business loan and consumer loans, Schenk noted.

The numbers indicate that "if the aggregate mortgage loans continue to deteriorate, it's likely that credit union portfolios will continue to be further stressed, but not at the magnitude experienced in other sectors of the industry," he said.

"Credit unions were much more careful in their lending activities and didn't originate toxic mortgages. However, their members do reside in declining markets," he said.

Email Brown on this subject

Service One's Visa credit card is a low-interest platinum card with rewards. I highly recommend the convenience and straightforwardness of Service One's Platinum Visa, appreciate your use of your credit union's product, and agree with the recommendations made in the following article.

Nat'l Publications Say 'Get Credit Cards at CUs'
CU Times article (9/9/09)--The Los Angeles Times and USA Today mentioned credit unions as a good place for consumers to obtain credit cards.

Credit unions are a potential source for low-interest-rate credit cards because they made "fewer costly mistakes in the credit heyday and now have money to lend," said personal finance writer Kathy M. Kristof in the Sunday Los Angeles Times.

In an article about how college students can build a credit history amidst new federal legislation that restricts marketing of credit cards to those under the age of 21, USA Today financial columnist Sandra Block told readers Tuesday that "many credit unions offer secured credit cards with lower interest rates and fees."

Email Brown on this subject

With all the news on subprime mortgages, several members have asked me how Service One's mortgages are doing? I answer them with "No problem." Service One's mortgage department does all it can to make the mortgage process the easiest possible and we are in the business of offering our members the best deal we possibly can at the time. Here is a great example of what credit unions are all about.

WSJ columnist shops for HELOC, remains with CU

NEW YORK (1/11/08)--A Wall Street Journal columnist who was looking to refinance a home equity line of credit (HELOC) found--after thorough price shopping--that her credit union offered the best financing rates.

Columnist Terri Cullen, who writes a weekly "Fiscally Fit" personal finance column for the paper, told her readers that she and her husband opened a five-year, $100,000 HELOC in 2003 to fund home improvements. With the end of the term approaching, they needed to refinance. After comparison shopping, they decided on their credit union (The Wall Street Journal Jan. 10).

Cullen said her credit union offered a five-year credit line at 6.24%, and unlike her current line of credit, this one offered a fixed rate.

She then checked with financial companies--bank and lenders--that she had conducted business with in the past, as well as her primary mortgage company--which would only go as low as 6.49% on the interest rate.

Her bank said it would match the credit union's 6.24% rate, but there were several caveats. Among them: she would have sign up for automatic monthly payments and transfer a minimum of $25,000 to the credit line; and she discovered--after examining the fine print--that there was an upfront interest-only period on the loan's term, where the loan balance would not decline unless she made additional principal payments.

Cullen's last move was to check a financial information website--Bankrate.com--to do more comparison shopping. The lowest offer she found was a $100,000 line of credit with a 6.25% interest rate, but it was an adjustable-rate credit line.

Satisfied that they had the best deal, she and her husband chose to refinance with her credit union.

There are so many ways to utilize Service One's account structures to help you save money. For no additional cost, you can open unlimited savings accounts to put money away for various purposes, and manage them online. Save for birthdays, education, taxes, insurance, holidays, vacations, HD TVs, or whatever you have as a goal. The following article from USA Today gives credit unions high marks for their holiday clubs. Just call or stop by to ask about how you can better manage your money in the future starting in 2008.

USA Today: CU holiday clubs help avoid spending hangovers

Credit unions looking to help their members avoid holiday spending hangovers should encourage them to set money aside in Christmas Club accounts for next year's holiday season.

With Christmas Club or similar holiday club accounts, credit unions deduct select amounts from members' paychecks and set the money aside in a separate fund that can be used for holiday spending.

Alberto and Marta Zamora, members of Landmark CU in New Berlin, Wis., set aside $70 per month for their Christmas Club account earlier this year. The money was automatically deducted from their paychecks. In October, the money was transferred to their checking account so the couple could start shopping.

The clubs are "convenient," and the couple "doesn't have to worry" about buying presents for family because they've already saved for the Christmas season, Alberto Zamora told the Milwaukee Journal Sentinel (Dec. 11).

The average consumer planned to spend $923.26 this year, according to BIGresearch and the National Retail Federation. If consumers set money aside for the holidays through Christmas Club accounts, they can "have a debt-free Christmas next year," Gail Cunningham, spokesman for the National Foundation of Credit Counseling, told the newspaper.

So many fun and informative financial education events are happening at Service One that I want you to have a list. Call us for more detailed information - 796-8500 ex.2030. All seminars are free, of course, and presented by the management staff at SOCU.

Sept 11 - Basic Money Management (Kristie Kennedy)
Sept 13 - Build a Basic Budget (Stephen Carrico)
Sept 19 - Basic Money Management (Kristie Kennedy)
Oct 9 - Which Car Can I Afford?
Oct 11 - Shopping for a Home (Stanley Groves)
Oct 17 - Which Car Can I Afford?
Oct 23 - Financial Planning (Drs. Wolfe/Chhachhi)
Nov 7 - CreditAbility (Kristie Kennedy)
Nov 13 - Fraud Prevention
Nov 28 - Eliminate Debt (John Stanford)

What else would you like to have offered? What are the best times for you? Let me know and we will try to arrange a financial learning experience that suits your needs.

Three seminars were held for the Community Action employees in August - what a great group of folks! Build a Basic Budget was presented to 150 employees.

Thought for Today:
People change only for three reasons:
1) When they hurt enough and have to;
2) When they learn enough and they want to;
3) When they receive enough and they can.